Abano confirms continued earnings growth in updated guidance

Healthcare investor and operator, Abano Healthcare Group, today provided an updated guidance for its financial year ending 31 May 2009.

Chairman of Abano, Mrs Alison Paterson, said: “Abano’s businesses performed solidly over the Christmas/New Year period and the Group has tracked well into the new calendar year with revenue and operating cash flows remaining strong.

“However, Audiology has recognised lower revenues following an unprecedented positive response to an advertising campaign in the last two months. All clinics are working overtime to process an unexpected demand for free initial pre-screening appointments. These appointments will lead to revenue generating fittings over the next few weeks. The full revenue benefit of this campaign will not be seen in the current financial year ending 31 May 2009, although the costs of the campaign will be expensed in this financial year.

“As a result, we have revised our market guidance. We continue to expect to be solidly up on last year with a revenue guidance of between $184 to $187 million (previously $170 to $180 million), and Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) guidance between $30.5 to $32.5 million (previously $28.0 to $32.0 million). A Net Profit After Tax (NPAT) of between $9.1 to $9.7 million (previously $10.0 to 11.0 million) is expected, which will be 17% to 25% above last year’s result.

“The expected NPAT performance range, while below our previous guidance, will still be a record result. The revision is primarily as a result of the delayed revenue recognition impact from the Bay Audiology marketing promotion and a one off charge for costs associated with a transaction that did not proceed.”

Managing director of Abano, Mr Alan Clarke, commented further on the operational performance.

“Abano’s rehabilitation, dental and diagnostic sectors are all meeting or exceeding forecast. The dental sector will improve its overall contribution and margin on last year, having acquired a further twenty seven clinics this financial year in New Zealand and Australia.

“Bay Audiology in New Zealand is seeing strong demand for its services and products as witnessed by the extraordinary response to the recent promotional campaign aimed at both seniors and baby boomers. The consolidated audiology group has opened or acquired thirty new permanent clinics so far this financial year in New Zealand, Australia and Asia and it is also expected to show strong revenue and earnings growth over last year.”